Deborah King of Elkmont addresses members of Athens City Council and about 120 people who attended a meeting Monday night, Oct. 22, 2012. King was voicing opposition to a 1-cent sales tax increase which later passed by a vote of 4 to 1. (Kelly Kazek/kkazek@al.com)

ATHENS, Alabama - When the Athens City Council approved a 1-cent sales tax increase during its meeting tonight, a few people booed and several others rose to leave although the meeting was still in session. The tax increase was approved by a vote of 4 to 1, with Councilman Jim Hickman saying he changed his mind after getting citizen input. He voted against the measure.

"This stinks to high heaven," he said in remarks before the vote. He was referring to an issue many residents had complained about, the fact that the vote occurred 13 days before a new council is seated on Nov. 5. At that meeting, the council will have three new members and several people who spoke said the vote was pushed through to guarantee its approval.

Athens City Councilman Jim Hickman explains his change of heart before casting the lone vote against a 1-cent sales tax increase at a meeting Monday, Oct., 22. (Kelly Kazek/kkazek@al.com)

Hickman is one of the outgoing council members after he lost his bid for election in September.

One backer of the increase, Councilwoman Dr. Milly Caudle, agreed with attendees that a newly seated council would likely oppose the tax. The reason, she said, would be pressure such as residents were bringing to the issue now. "Because of the resistance to all taxation, it would be difficult for them to do that," she said, referring to new council members. Caudle did not seek re-election after six years on the council.

"It seems to me we don't want to ask new members of the council to be faced with this decision," she said. Council member Mignon Bowers also did not run for re-election. After Nov. 5, the council seats will be held by Chris Seibert in District 1, Joseph Cannon in District 4; and former police chief Wayne Harper in District 5. Wales and Gill were unopposed for their seats in districts 2 and 3, respectively.

In previous interviews, incoming council members would not say how they would vote but two said they wished the council would wait to vote.

Later in the meeting in response to several questions about why the council didn't seek an ad valorem tax, Caudle reminded attendees they had a history of voting against any tax increase, leaving city leaders with few choices for new revenue streams.

"How many of you in this room would vote for an ad valorem tax?" she asked the more than 120 people attending. Three people raised their hands. She then said while the city is currently financially sound, it is headed for trouble.

"Yes, we have a balanced budget because we have kicked down the road the items that need to be replaced," she said. Caudle added that the turnout indicated the majority of citizens were either "not concerned with or would approve of" the increase.

Wales said he initially opposed the idea of a sales tax but after much study and thought, he realized residents would never vote for an increase and the sales tax hike was the only option left to the council.

The increase will take effect Jan. 1 when sales tax will go from 8 percent to 9 percent, or 9 cents on a dollar. The hike is expected to bring about $4.4 million in additional revenue annually, which the council said is desperately needed to repair roads, replace public safety equipment, hire police and fire officers and make improvements.

The 2 percent sales tax generates about $9 million for the city, said Annette Barnes, city financial director. In contrast, the city's share of the 10 mill property tax generates only about $1.2 million annually, she said.

The tax on alcohol sales, which were legalized in 2004, generates about $600,000 per year, half of which goes to schools.

• General fund: 30 percent. Funding would go to public safety, services and quality-of-life improvements.

• Schools: 20 percent. Money would go into a special account that would be used at the discretion of the council for projects proposed by city schools.

• General fund contingency: 20 percent. These funds would be used for debt service and emergency items.

What the public said

During the public commentary portion of the meeting, two people demanded apologies from Gill for a comment he made to Deborah King during Friday's work session. After King got tearful and emotional, at times shouting to the council, Gill remarked, "Thanks for the good entertainment."

At Monday's meeting, King apologized to council members for saying she hated them during Friday's session. "I don't hate you," she said. "I hate what you are doing. We were outraged by the fact that you, the council, had already made your decision."

Tony Llewellen also asked for an apology to King and the public. "You did not allow us to speak before you told us how you were going to vote," he said. "I'm just flabbergasted."

As he walked from the podium, Llewellen said to attendees: "I have some clothespins here fort anyone who wants to hold their nose tonight during the vote."

Gill did not apologize to King publicly. He and Wales commented the content of the emails and phone calls they received on the issue were in bad taste. "You would think we had graduated past that," Gill said. "The ugliness has come out."

Wales said he also received nasty emails and phone calls and said, "I can take that. I'm a big boy."

Lakin Collins, a former mayor of Athens and a local business owner, said: "I don't have a problem with your understanding of the needs we have I have a problem with the way you went about it. If you didn't use the Nancy Pelosi/Harry Reid cram-it-down-your-throat attitude it would go over a lot better... You've blown trust completely out of the water"

Rex Davis said the council should be concerned with the people the vote impacts. "I think you need to sit back and think about how you're doing business, the number of people you're upsetting and the number of people who don't know why you're doing this," he said.

Limestone County Commission Chairman Stanley Menefee said before the vote that if council members' minds were made up to pass the tax, he hoped members would consider sharing. "The rest of the county is going to pay this tax but they're not going to get anything for it. Consider the Limestone County Commission before you do this. We've got budget problems too. Our school system needs assistance."

Ralph Diggins, who said he does not oppose the tax increase
but is not happy with the way the issue was brought to the community, told
attendees they should come to meetings
regularly and not just when an issue such as this arises,

"If everybody was participating and keeping up with what's
going on, this probably wouldn't have happened," he said. "Coming out of the
other side of this vote, we've got to get along and make the new council
successful."

The city answers questions

The information below was generated by the City of Athens in response to residents' questions on the tax increase:

What are area tax rates? Area cities do not have a lower tax rate than Athens, although some counties do, making the overall sales tax rate lower. The state's portion of all sales tax is 4 percent. A comparison:

● Athens' current rate: 8 percent, of which Athens gets 2 percent, divided between schools and the general fund, and Limestone County gets 2 percent;

● Decatur: 9 percent, of which the City of Decatur gets 4 percent and Morgan County gets 1;

● Madison: 8.5 percent, of which the city gets 3 percent and Madison County gets 1.5;

● Huntsville: 8 percent, of which the city of Huntsville gets 3.5 percent and Madison County gets .5 percent.

Are some items exempt? This tax would not impact automobile sales, manufacturing machinery sales or agriculture equipment sales.

What is the condition of the city's general fund and why has Mayor Ronnie Marks been telling people the city is financially sound? The 2013 general fund is projected to have a $45,183 surplus at the end of the budget year without the sales tax increase. That's based on the council opting to level fund its appropriations to outside agencies. The council has not voted on appropriations yet. The city also paid off a debt early to save money. Where money is needed is for capital expenditures, such as a $750,000 ladder truck for Fire and Rescue, and to add more police officers and firefighters to address public safety related to the city's growth. The city has grown 15.4 percent the past 10 years and has a population of nearly 22,000.

Will the money be used for salary increases? The council has already decided not to raise the council or mayor's salaries so that issue cannot come up again for four more years. By law, the council makes that decision prior to a newly-elected council/mayor taking office.

What types of items are bought for schools? The council does not buy classroom supplies, iPads, land, buildings, etc. for the school system. The school system gets half of sales, property and alcohol taxes and would get 20 percent of this increase. It is up to the school system how that money is spent.

Will this tax help build the new library? This tax has not been created for the Athens-Limestone Public Library project. The city and county have already allocated what funds each would spend toward renovations, and that money is in a separate account. The library does, as do other outside agencies, get annual allocations for operating costs, etc. Those outside agency allocations have not yet been approved for the 2013 budget year.

Why doesn't the increase require a vote of the people? The council has the authority to change the sales tax rate, according to Alabama law. Property tax is different. Voters get to vote on a property tax increase proposal.

This story was updated at 10:14 p.m. Oct. 22 to include comments from residents, a list of how tax money will be used, and the city's responses to residents' questions.